Stock market rebounds but foreign selling persists

Tuesday, 7 July 2020 01:06 - - {{hitsCtrl.values.hits}}

The Colombo stock market saw welcome rebound though less convincing but turnover remained healthy at over Rs. 1 billion amidst net foreign selling.

Acuity Stockbrokers said the bourse ended on a mixed note as the ASPI increased by 0.49% or 25.00 points to close at 5,075.90 points, while the S&P SL20 Index decreased by 0.10% or 2.19 points to close at 2,188.56.

Turnover decreased by 1.1% relative to last Friday to amount to Rs. 1.47 billion while crossings for the day amounted to 30.0% of the day’s total turnover.

Foreign Investors meanwhile, recorded a net outflow of Rs. 0.66 billion over the day compared to a net inflow of Rs. 0.39 billion recorded on Friday.

First Capital said the bourse ended in the positive territory reversing the impact seen in the last five session while Capital Goods contributed to 41% of the turnover breaking the three-week dominance of banking counters.

“The index recorded a downtrend within the first 30 minutes of trading due to the selling pressure on the Banking counters and hit its intraday low of 5,032 thereafter spiked due to the price advance in CTC and reached its intraday high of 5,086. Later market experienced a sideways movement and closed at 5,076 gaining 25 points,” First Capital said.

It said parcel trades boosted the turnover contributing 36% of the total. Market experienced moderate foreign participation dominated by the selling side resulting in a net outflow.

NDB Securities said the ASPI closed in green as a result of price gains in counters such as Ceylon Tobacco Company, Dialog Axiata and LOLC Development Finance.

High net worth and institutional investor participation was noted in John Keells Holdings, Hatton National Bank and Nation's Trust Bank. Mixed interest was observed in Sampath Bank, Piramal Glass and Hemas Holdings whilst retail interest was noted in Hatton National Bank non-voting, Tokyo Cement Company non-voting and First Capital Holdings.

Furthermore, foreigners remained active closing as net sellers mainly due to foreign selling in John Keells Holdings and Hatton National Bank. Total foreign sales accounted for 50.6% of the turnover.

The Capital Goods sector was the top contributor to the market turnover (due to John Keells Holdings) whilst the sector index lost 1.13%. The share price of John Keells Holdings decreased by Rs. 2.80 (2.42%) closing at Rs. 112.80 whilst foreign holdings decreased by 1,814,582 shares.

The Banking sector was the second highest contributor to the market turnover (due to Hatton National Bank, Sampath Bank and Commercial Bank) whilst the sector index decreased by 0.22%. The share price of Hatton National Bank lost Rs. 0.60 (0.54%) closing at Rs. 110.10 whilst foreign holdings decreased by 1,449,562 shares. The share price of Sampath Bank moved down by Rs. 2.10 (1.72%) to close at Rs. 120.00 while the share price of Commercial Bank declined by Rs. 0.70 (0.92%) to close at Rs. 75.80.

Renuka City Hotel was also included amongst the top turnover contributors. The share price of Renuka City Hotel recorded a loss of Rs. 1.90 (0.97%) to close at Rs. 193.10.